Google Does The Right Thing, Again

Five years ago, Google did the right thing: it exited the world’s largest Internet market rather than yield to China’s censorship rules.

Now, Google has done it again, fighting allegations by the European Commission (EC) that “the company has abused its dominant position in the markets for general internet search services in the European Economic Area (EEA) by systematically favouring its own comparison shopping product in its general search results pages. The Commission's preliminary view is that such conduct infringes EU antitrust rules because it stifles competition and harms consumers.”

Here is a quote from Google’s response to EC allegations: “While Google may be the most used search engine, people can now find and access information in numerous different ways—and allegations of harm, for consumers and competitors, have proved to be wide of the mark.”  The company further provides comprehensive data to defy EC’s allegations.

Why is that the right move? Because regulators usually have a political agenda. In the name of “competition,” they usually support and re-enforce entrenched economic interests, and end up limiting competition and innovation.

The absence of Google from China, for instance, leaves the market to local competitor Baidu , which enjoys a near monopoly there. And any restrictions in the way Google does business in the EU will strengthen local competitors.

Doing the right thing has consequences, of course. Leaving China, Google has suffered a great deal in missing earnings, and fighting EC could end up with the company having to pay severe fines. But that’s part of a company’s character, and character is destiny.

That’s one of the Golden Rules of Leadership.

Besides, Google has demonstrated that it can make money by doing what’s its leadership believes to be right.

Google’s Financial Metrics

Source: finance.yahoo.com